Lessor loses VAT deduction case

The Supreme Administrative Court (SAC) expressed its opinion on claiming a reduced VAT deduction in a case involving air-conditioning repair in a building where premises were leased both with and without VAT. According to the court, as the link…

Expats’ income tax base to be ‘super-grossed’ by fictitious premium only once

The remuneration of expatriates working under an international lease of workers that is paid partly by their formal/legal employer abroad and partly by their economic employer in the Czech Republic shall be increased for the purposes of determining…

Time limit for assessing tax in the context of international requests for information

International requests for information affect the time limit for assessing tax. For time limits that started before 2014, this only applies to some taxes. The Supreme Administrative Court’s (SAC) case law deduced that there is a fundamental…

Assessing agent’s dependence in the context of permanent establishment

The Supreme Administrative Court (SAC) has described the key defining features of a dependent agent for the purpose of assessing whether a permanent establishment of a foreign entity has started to exist in the Czech Republic. Among its conclusions…

SAC on proving delivery to another member state and on abuse of right

The abuse of right concept has been recently quoted mainly in connection with the adoption of the tax package. According to the amended Tax Procedure Code that defines it, the abuse of right concept applies to transactions whose predominant purpose …

SAC: transfer of tax labilities by operation of law possible in spin-offs

Contrary to its previous case law, the Supreme Administrative Court agreed to the possibility of tax labilities being transferred by operation of law also in demergers by spin-off, when the company being demerged is not dissolved. The court cited a…

SAC: liability for unpaid VAT not to take precedence over denying an entitlement to VAT deduction

The Supreme Administrative Court (SAC) in its recent judgement held that (customer’s) liability for VAT unpaid by the supplier does not universally take precedence over denying (the customer’s) entitlement to VAT deduction – which has undesirable…

SAC: difference between receivable’s nominal amount and purchase price may be subject to VAT

According to the recent Supreme Administrative Court judgement, the difference between the nominal value of a receivable and its purchase price upon its transfer may be viewed as a factoring consideration, which is subject to value added tax.

Research and development allowance for clinical studies

In a recent judgement, the Supreme Administrative Court (SAC) held that a research and development allowance had been claimed unlawfully, as the project in question had no element of novelty. The SAC dealt with the third phase of clinical research…

SAC: Involvement in tax fraud must always be proved by tax administrator

The Supreme Administrative Court (SAC) dealt with a case in which the tax administrator denied a taxpayer’s entitlement to deduction of VAT on received taxable supplies, claiming that the taxpayer knew or should have known that they had been…

SAC on proving VAT exempt supplies to another EU member state

In its recent judgment, the Supreme Administrative Court (SAC) dealt yet again with the case where the VAT exemption of a cross-border supply of goods was challenged by a tax administrator. Apart from the specific circumstances of the case, the…

Active defence pays off in tax fraud investigations

The Supreme Administrative Court (SAC) has brought a new perspective on proving the taxpayer’s involvement in a transaction affected by tax fraud. While remaining consistent with its previous case law as to the distribution of the burden of proof,…